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Hagoromo president explains why he closed down his beloved chalk business

asia.nikkei.com

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Re: Hagoromo president explains why he closed down his beloved chalk business

#21

Post by blfr »

fsloth wrote: post #8

The main reason, apparently: "These days, local governments focus on bid prices rather than quality." High quality commodities are considered nowadays luxury and not bare minimum. Quite sad, really.

It's more than that. Right above the line you quote

Earlier, companies based in a city, ward or town were given a priority at auctions held by their governments.

Local companies were given priority not because they were providing higher quality product but simply because they were from the area.

Re: Hagoromo president explains why he closed down his beloved chalk business

#22

Post by toyg »

creshal wrote: post #14
kriro wrote: post #12

This whole saga pretty much has to inspire someone to build and reverse engineer the machine/recipe. The overlap of people who like to tinker with this stuff and people who love the chalk seems big enough. It's also interesting that they seem to be somewhat oblivious of the US demand. At least it seemed like that. My guess is that they could have sold one of the machines to a US based entrepreneur. I can pretty much…

> It's also interesting that they seem to be somewhat oblivious of the US demand. I have no idea why, but with Japanese companies it's a common theme. Most don't even care about overseas expansion, and if they do, it's poorly executed (say, Daihatsu, who dicked around on the European market for decades without ever listening to even trivial customer wishes, and then wrote the whole business off because it "obviously…

There is a cultural element -- the Japanese perceive the cultural contrast between their world and "ours" more acutely than we do, in both directions (i.e. their positions go from "the West is much better than us" to "the West is so much worse than us" very quickly, it's hard to find level-headed assessments of both positions). Most of the "obviously it can't work" sentiment actually comes from there, in many cases.

And then there is an economic issue: their currency has been so strong for so long, it simply wasn't worth for most medium-to-small companies to invest in tricky oversea expansion for a very long time. Things have changed a bit there, but the cultural perception has not shifted much.

There is also the obvious difficulty of limited chances for local expansion: the country closest to them in cultural terms are Korea, which they historically see as inferior and poorer, and China, which they know they simply cannot match on equal terms.

And then, of course, there is the recent history of train-crash expansion in the '80s. That didn't end well, and some of the lessons they learnt was not to try too hard to expand abroad.

Re: Hagoromo president explains why he closed down his beloved chalk business

#23

Post by polymatter »

pmr_ wrote: post #17
daurnimator wrote: post #11

Earlier quoted context omitted.

If you instruct a machine to optimize for the cheapest price; it will do that. The failure is in the instructions given, not the introduction of machines.

That much should be clear, my (unfortunately) implicit question is: how can we instruct a machine to optimize for the very intangible things everybody seems to love so much about this chalk? What about the more subtle economic things (like signals of economic climate and value of quality).

optimise by a score. score is calculated as a function of price and some quality metric. unfortunately this can get complex.

Re: Hagoromo president explains why he closed down his beloved chalk business

#24

Post by Shivetya »

fsloth wrote: post #8

The main reason, apparently: "These days, local governments focus on bid prices rather than quality." High quality commodities are considered nowadays luxury and not bare minimum. Quite sad, really.

that didn't appear to be the main reason, his volume dropped in half since its peak because technology is moving beyond chalk and blackboards.

besides, it is common for many businesses to fall back on the excuse that their quality justifies their price without proving that their competitors are not delivering what is requested.

if you are over delivering and doing well that is fine, but if you are over delivering and losing money your not doing it right and the market will correct you one way or another

just the milkman the chalkboard has been obsoleted.

Re: Hagoromo president explains why he closed down his beloved chalk business

#25

Post by ChrisNorstrom »

kriro wrote: post #12

This whole saga pretty much has to inspire someone to build and reverse engineer the machine/recipe. The overlap of people who like to tinker with this stuff and people who love the chalk seems big enough. It's also interesting that they seem to be somewhat oblivious of the US demand. At least it seemed like that. My guess is that they could have sold one of the machines to a US based entrepreneur. I can pretty much…

US demand and overseas markets can't cancel out Supply and Demand and market forces.

- Chalk is on it's way out. It's a rapidly shrinking market. Each year there will be less customers and less profit world wide.

- He could have sold the machine to another entreprenuer? Their company makes 45 MILLION sticks of chalk. They're getting their materials at a high bulk discount. Another company can never match the price point. They'll end up selling the same chalk at double the price.

- And expansion into the USA is laughable. Try expanding into an existing market with well established players (crayola) that is shrinking and on its way out.

- And this is the USA we're talking about, we prefer cheap products to quality ones. The only time it seems we invest in premium products is when they are an American brand, made in America.

Re: Hagoromo president explains why he closed down his beloved chalk business

#26

Post by noir_lord »

daurnimator wrote: post #11
pmr_ wrote: post #10

Earlier quoted context omitted.

I think the statement following this is much more important and interesting to HN: > The tendency has become more and more prevalent under electronic auction systems. While incidents like this are often used as examples of the failures of technocracy, I think the problem is elsewhere. A decision process has been out-sourced to a machine that is not smart enough yet to make a good decision. The decision might be good…

If you instruct a machine to optimize for the cheapest price; it will do that. The failure is in the instructions given, not the introduction of machines.

> If you instruct a machine to optimize for the cheapest price; it will do that

if (x The classic "you optimise for what is or can be measured rather than what is important."

There are ways around this of course by setting minimum quality via an objective third party (MIL-STD's for example) but that process introduces a whole new can of worms.

Re: Hagoromo president explains why he closed down his beloved chalk business

#27

Post by fnordfnordfnord »

polymatter wrote: post #23
pmr_ wrote: post #17

Earlier quoted context omitted.

That much should be clear, my (unfortunately) implicit question is: how can we instruct a machine to optimize for the very intangible things everybody seems to love so much about this chalk? What about the more subtle economic things (like signals of economic climate and value of quality).

optimise by a score. score is calculated as a function of price and some quality metric. unfortunately this can get complex.

Right, a specification for chalk is for chalk, uncolored, and or colored. There is no way to specify for quality.

Re: Hagoromo president explains why he closed down his beloved chalk business

#29

Post by impendia »

ChrisNorstrom wrote: post #25
kriro wrote: post #12

This whole saga pretty much has to inspire someone to build and reverse engineer the machine/recipe. The overlap of people who like to tinker with this stuff and people who love the chalk seems big enough. It's also interesting that they seem to be somewhat oblivious of the US demand. At least it seemed like that. My guess is that they could have sold one of the machines to a US based entrepreneur. I can pretty much…

US demand and overseas markets can't cancel out Supply and Demand and market forces. - Chalk is on it's way out. It's a rapidly shrinking market. Each year there will be less customers and less profit world wide. - He could have sold the machine to another entreprenuer? Their company makes 45 MILLION sticks of chalk. They're getting their materials at a high bulk discount. Another company can never match the price po…

> Chalk is on it's way out. It's a rapidly shrinking market.

I am a math professor. Most of us prefer chalk, and have no desire to go to whiteboards, smart boards, Powerpoints, what have you. I think that there is a fairly durable market for chalk.

Moreover, over the last five years I think that awareness of Hagoromo (and more generally, of high-end chalk) has been growing. You see it for the first time when visiting some other university and think "Wow, what is this? I must have some!" This led me to buy several boxes of it at $35 a pop. My out-of-town guests, who give lectures in the research seminar I help to run, get treated to the good stuff.

Re: Hagoromo president explains why he closed down his beloved chalk business

#30

Post by my-bullshit-job »

impendia wrote: post #29
ChrisNorstrom wrote: post #25

Earlier quoted context omitted.

US demand and overseas markets can't cancel out Supply and Demand and market forces. - Chalk is on it's way out. It's a rapidly shrinking market. Each year there will be less customers and less profit world wide. - He could have sold the machine to another entreprenuer? Their company makes 45 MILLION sticks of chalk. They're getting their materials at a high bulk discount. Another company can never match the price po…

> Chalk is on it's way out. It's a rapidly shrinking market. I am a math professor. Most of us prefer chalk, and have no desire to go to whiteboards, smart boards, Powerpoints, what have you. I think that there is a fairly durable market for chalk. Moreover, over the last five years I think that awareness of Hagoromo (and more generally, of high-end chalk) has been growing. You see it for the first time when visiting…

As a student, I preferred chalkboards to whiteboards because they were easier to read. It seems that most of the time, unless the professor had an exceptionally well working dry-erase marker, the lines were too thin and light for me to read them, no matter the color.

I remember thinking that the whiteboards were an improvement at first, but that quickly changed when I realized I couldn't read what was written on them anymore.

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